The price of oil has spiked again, following fresh attacks on ocean and air shipping infrastructure, with more vessels confirmed struck in the Middle East.
As well as giving mixed signals on when the war might end, the Trump administration has announced another set of tariff investigations, as a precursor to the return of the previous ‘reciprocal’ regime.
However, in good news for traders, a new report by logistics company DHL has found that the global trading system might not be as damaged as previously thought.
Iran latest
Attacks on Gulf ships have intensified, with oil prices topping US$100 again after Iranian attacks on economic targets across the Middle East.
This morning (12 March), Kuwait International Airport was damaged in a fresh wave of attacks. Dubai has also reported towers hit by drones. The Khalifa Bin Salman Port has shut down following drone strikes, only hours after Oman Port announced it was resuming operations.
The UK Maritime Trade Observatory (UKMTO) reported another vessel struck today, causing a fire onboard. Over a two-week period, the UKMTO reported 16 total attacks on commercial shipping around the Strait of Hormuz, Gulf of Oman and Arabian Gulf, with three reported yesterday alone.
The White House continues to send out mixed messages on the possible end-date to the war. Trump told Axios that the war with Iran will end “soon" because there is "practically nothing left to target."
"Little this and that... Any time I want it to end, it will end," the president told Axio’s Barak Ravid during a five-minute phone call. This is the second time that he has suggested that he could draw the conflict to an end this week. Hours later, he said that he would “finish the job” in a campaign-style speech in Kentucky.
The International Energy Agency (IEA) has announced the largest ever release from oil reserves, with IEA executive director Fatih Birol calling the oil market facing a crisis “unprecedented in scale”. This amounts to 400 million barrels released from emergency reserves by governments around the world, which Trump said would ease the pressure on domestic market.
UK energy secretary Ed Milliband confirmed that the UK would be among the countries participating in this release.
Tariffs latest
The White House has also announced a new set of tariff investigations, as a possible precursor to the return of the ‘reciprocal tariff’ regime.
In an emailed statement to Global Trade Today, US Trade Representative Jamieson Greer announced a new set of section 301 investigations under the Trade Act 1974. The investigation targets a number of countries including the EU, China, Norway Japan, Mexico and India.
The investigation is purportedly being carried out to determine whether any of the listed countries – which does not include the UK, Brazil or Canada – are engaging in “unfair foreign practices affecting US commerce.”
“The United States will no longer sacrifice its industrial base to other countries that may be exporting their problems with excess capacity and production to us,” Greer said in his statement
He said that the target was to finish the investigations ahead of the expiry of the current 15% rate, which Trump imposed on foreign partners after the US Supreme Court ruled that the policy was illegal.
Connectivity holding up?
New research from DHL has found that the international trade environment has not been as badly hit as previously thought.
The DHL Global Connectedness Index found that trade connectivity along various capital, information and people routes remained stable, and forecast trade growth to continue over the next few years.
Although US-China ties continue to diminish, the report says that overall world trade has not split into disconnected geopolitical blocs:
“Trade flows shifted more toward neutral countries than to close allies, implying more ‘de-risking’ than ‘friendshoring’.”
The report’s authors said that businesses should not withdraw from international opportunities in order to avoid supply chain disruptions, as this could disadvantage a company compared to competitors that continue to trade internationally.
“In today’s volatile business environment, with much talk of deglobalisation and a fracturing of the global economy, the underlying data tells a different story,” the report concluded.
“Global flows of trade, capital, information, and people are not retreating—they are holding firm.”
Other news
- The Department for Business and Trade (DBT) has updated the Open General Export Licence (OGEL) for the Typhoon military project
- Five new railway stations have been opened in the West Midlands, with regional mayor Richard Parker saying that they will drive economic growth and open up new opportunities for businesses
- Sonia Kumar, Labour MP for Dudley, and Baronness Ruth Anderson have both been appointed to junior ministerial positions in the cabinet office
- Trump ally José Kast was inaugurated as Chilean President yesterday, taking over from the left-wing Gabriel Boric
Yesterday in trade
- Insurance companies have insisted they will still cover Middle Eastern-bound vessels, following complaints that policies were being cancelled
- Tariffs were removed on offshore wind components, which DBT linked to the need to build up the UK’s energy security
- HMRC is seeking feedback on the Carbon Border Adjustment Mechanism (CBAM) guidance
You can read all that news here.
